Agenda item

Director of Finance to report.

The Audit Committee received a report that presented clarification on the current position relating to Oldham Borough Council’s Financial Statements for the year 2024/25. In considering the report, the Committee was reminded that it was the council body that was charged with scrutiny and approval of the Statement of Accounts. The submitted report presented, therefore, an update on the progress of the auditing and approval of the 2024/25 Statement of Accounts, further to previous consideration thereof, by the Committee, at its meeting held on 23^rd July 2025.

It had initially been expected that the External Auditor would have completed the audit by the time of this Audit Committee meeting, but prior to the issue of the agenda papers the Council was notified that although the audit of the Accounts remains substantially complete, the External Auditors are awaiting a response back from their technical team in respect of the Manchester Airport Shares Valuation and with some further review work remaining to be completed in relation to lease and Private Finance Initiative accounting.

Therefore, approval was sort to delegate the formal approval of the Accounts to the Chair of the Audit Committee in conjunction with the Director of Finance and the External Auditor.

The External Auditor, in the report that was considered at Minute 7, below, had advised that the audit of the Council was substantially complete. A further update report would be presented to the next scheduled Audit Committee meeting, on 14^th January 2026 and Members would be notified when the Statement of Accounts for 2024/25 had been fully signed off.

In preparing the report the Director of Finance reported that consultation had taken place thereon with the Council’s External Auditors, Forvis Mazars LLP.

In addition, members of the public have had an opportunity to inspect the Council’s Statement of Accounts and supporting documents during the 30-day public inspection period which concluded on 11^th August 2025.

In considering the report Members of the Committee sought clarification on several issues:

a.    The changes to the Statements that had been added since the last consideration of the 2024/25 Financial Statements at the Committee’s meeting on 23^rd July 2025. The Director of Finance, in reply, noted that several changes had been made to the documents and an updated version of the documents that specifically highlighted the changes that had been made, would be circulated to members of the Committee.

b.    In terms of the value for money recommendations, contained in Appendix 1 to the submitted report, a member sought clarification on the effective budget setting and monitoring processes reported and sought assurances as to how this conclusion had been arrived at. It was noted that the bulk of the Councils expenditure was taken up by Children’s and Adults Social Care services. The demand for these services had increased significantly in recent years and, as a large proportion of this expenditure was mandatory mitigations had been included in the Council’s budgetary planning for 2026/27 and future years by such measures as a council-wide recruitment freeze apart from essential care sector vacancies.

c.     The Council was, in 2026/27, on course to set a balanced budget and the budget setting process for 2026/27 through to 2029/30 was being eased somewhat as the government was issuing local authorities with a three-year settlement, which would help the council with its forward financial planning.

d.    A member noted that the authority had invested significant funding recently in the acquisitions of properties to be used as residential children’s homes, with the aim of reducing future expenditure on out-of-borough placements.

e.    The Committee noted the revised population projections for the Borough of Oldham with the likelihood of an increased ageing population that would, in time, lead to more people using Oldham’s Adult Care Social services.

f.      A Member sought clarification on the levels of reserves that the Council was utilising to balance its budget and asked if the Council’s Director of Finance would be issuing a ‘Section 114 Notice’, which was a formal declaration by a UK local council's Chief Finance Officer that its projected spending will exceed its income, meaning it can't balance its budget, triggering restrictions on all non-essential new spending except for protecting vulnerable people and statutory services. In this regard the Director of Finance reported that at the budget setting Council meeting, on 4^th March 2026, he would be providing a report that outlined his opinion as to whether the Council’s budget setting arrangements were ‘robust’.

g.    A Member sought assurances from the Cabinet Member for Finance, Corporate Services and Sustainability that he accepted the recommendations from the external auditors, Forvis Mazars LLP, that the Council should review its budget setting processes. The Cabinet Member, in reply, advised that he did fully accept the recommendations and that he would, wherever necessary, update future meetings of the Committee thereon.

The Executive Director of Resources advised the meeting that she would be asking the Council’s Head of Audit and Counter Fraud to monitor and audit each of the savings’ proposals that are agreed by the Council and details thereon will be included in the Committee’s Work Programme.

Resolved:

1.    That the Committee notes and approves the reported changes to the Statement of Accounts 2024/25.

2.    That the Audit Committee delegates authority to approve the Council’s 2024/25 Statement of Accounts to the Chair of the Audit Committee after consultation thereon with the Director of Finance and on receipt of appropriate advice from the Authority’s External Auditor. In this regard the Council, the Director of Finance explained, was lobbying the government to release additional resources, to ease the financial burdens that Oldham Council was facing, in common with many other local authorities throughout England.

3.    The Committee endorses the undertaking of the Director of Finance, in due course, to circulate to members of the Committee, the recorded changes that had been made to the Financial Statements for 2024/25.

4.    The Committee endorses the undertaking of the Executive Director of Resources to monitor and audit each of the savings’ proposals that are agreed by the Council and that details thereon, will be presented to future meetings of the Committee.